Do you need an ongoing financial planner?

October 13, 2018



Is it wise to have an ongoing relationship with a financial planner?


In my experience, young and mid-career professionals get a lot of value from having that relationship. Our life is not static. We change jobs, get a pay raise. People get married, have kids, choose to buy a condo or sell their house. We may be tempted to go off the beaten path and set up our own small business.


Our environment is also not static. Congress passes new laws that affect our tax rate and retirement vehicles. Investment opportunities come and go.


A financial planner can help us make wiser decisions as we go through our journey. Here are four situations when clients received value through ongoing advice.


Big Purchases


Joanna is a teacher in Maryland and we’ve been working on building her emergency savings over the past year. Last month, she decided it was time to retire her 11-year old sedan and get a used CRV with fewer mileage. (SUVs are really getting more popular). We talked about several financing options (including getting a car loan), but decided it was best for his boyfriend to lend her money. We discussed potential gift tax or IRS loan interest implications of this.


There’s also a discussion on when is it financially advantageous to buy a house or continue renting. It’s not a straightforward decision. A recent study by Florida Atlantic University, Florida International University and the University of Wyoming revealed that renting and reinvesting can be a better path for wealth creation. But owning can be a good way to force people to save.


Changing Jobs


Our client Thelma left her job at a large consulting company to work for a smaller firm for better work-life balance. What should she do with her now old 401(k) – keep it there, move it to her new 401(k) or roll it over to an IRA? What funds should she choose in her new 401(k)? Should she contribute to either a flexible spending account or health savings account with her new employer? These are some of the questions we helped answer for Thelma.


Create Your Own Venture


Evan has been yearning to strike it out on his own and build a small business. He has managed to get some income on the side and will soon establish a single-member LLC for his new consulting venture. We are advising him on how to set up estimated tax payments, so he doesn’t get hit with a huge tax bill in April. Evan can also take advantage of the fact that he can set aside a portion of his profit towards a SEP IRA, which reduces his tax bill.


Outstanding Action Items


Receiving 20 or so action items as part of a comprehensive financial plan will often feel like you’re drinking from a fire hose. Having an ongoing relationship with a financial planner can help you prioritize and take care of those action items over time without feeling too overwhelmed.


Returning to our client Joanna (the teacher) – she has been building her emergency savings for the past year. Now she is ready to contribute to her Roth IRA, and we helped her open one and identify the best investment to make within the IRA.


Thelma has been wanting to open a college savings plan for her two kids. She finally opened a 529 plan recently. We helped her choose the type of 529 to contribute towards, and the funds she can invest in (there are several types).



Many Americans continue to choose to go it alone with their finances. But having an expert in your corner can often be one of the best investments you can ever make. You can feel more at ease going through life, knowing you are making wiser financial decisions for yourself and your family.



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